Domestic ferrous scrap prices in North India increased with a rise in demand for finished steel. Construction projects are gradually resuming. Shortage of scrap in the market also supported prices.
The Davis Index for HMS 1&2 (80:20) rose by Rs475/mt($6.25/mt) to Rs20,200/mt ($265.8/mt) del Mandi Gobindgarh from Friday. The daily index for sponge iron increased by Rs200/mt in Mandi Gobindgarh to Rs18,600/mt delivered mills.
Domestic scrap collection has taken a hit since the past two months with a fall in production and demolition activities, tightening its supply in the market. In seaborne trades, ferrous scrap export ban imposed by the UAE government has also affected import prices in India.
Trades in Mumbai, a COVID-19 hotspot were thin with the lockdown extending till May 31. The daily Davis Index for HMS 1&2 (80:20) settled unchanged at Rs21,670/mt del Mumbai mills. The daily index for sponge iron increased by Rs200/mt to Rs21,760/mt del Mumbai mills.
Market participants are expecting scrap prices to rise further on the back of increased finished steel demand. Mainly since the government is trying to revive the construction and real estate sectors.